Stock prices fell throughout much of 2007 and 2008 and many investors decided to switch their funds into the bond market. What only about 30 percent of surveyed investors knew was that as bond prices rise, interest rates
A. fall in reaction to the increased demand for bonds.
B. fall in reaction to the decreased demand for bonds.
C. rise in reaction to the increased demand for bonds.
D. rise in reaction to the decreased demand for bonds.
Answer: A
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There is a negative relationship between the real rate of interest and investment spending
Indicate whether the statement is true or false
Which of the following statements best describes countries with controlled economies in the 1970s?
a. Countries with controlled economies in the 1970s, historically had very low rates of measured inflation—because prices were forbidden to rise by law, except for the cases where the government deemed a price increase to be due to quality improvements. b. Countries with controlled economies in the 1970s, historically had very high rates of measured deflation—because prices were forbidden to rise by law, except for the cases where the government deemed a price increase to be due to quality improvements. c. Countries with controlled economies in the 1970s, historically had very low rates of measured deflation—because prices were forbidden to rise by law, except for the cases where the government deemed a price increase to be due to quality improvements. d. Countries with controlled economies in the 1970s, historically had no inflation—because prices were forbidden to rise by law, except for the cases where the government deemed a price increase to be due to quality improvements.
Recall the Application about cultural factors in England and their relevance to the Industrial Revolution to answer the following question(s). According to the Application, the differential survival of the wealthy created an environment:
A. which allowed for economic growth. B. which caused increased class warfare. C. where lower-class people could no longer afford to live in the country. D. that directly led to the demise of the British monarchy.
If the quantity of pineapples demanded increases by 4% when the price of papayas increases by 16%, the cross-price elasticity of demand between pineapples and papayas is
A. -4. B. 0.25. C. 4. D. 64.